Shanghai canrui Technology Co., Ltd
(Room 308, science and technology building, No. 149, Yanchang Road, Shanghai)
Second round examination and inquiry letter on the application documents of Shanghai canrui Technology Co., Ltd. for initial public offering and listing on the science and Innovation Board
Reply Report
Sponsor (lead underwriter)
Shanghai Stock Exchange, North block of excellence Times Square (phase II), No. 8, Zhongxin Third Road, Futian District, Shenzhen, Guangdong Province:
We have received the inquiry letter on the second round of examination of the application documents of Shanghai canrui Technology Co., Ltd. for initial public offering and listing on the science and Innovation Board (szkss [2022] No. 137, hereinafter referred to as the "inquiry letter") issued by your office on March 25, 2022, Shanghai canrui Technology Co., Ltd. (hereinafter referred to as "canrui technology", "issuer" or "company") and Citic Securities Company Limited(600030) (hereinafter referred to as "sponsor" or " Citic Securities Company Limited(600030) "), Beijing Tianyuan law firm (hereinafter referred to as "issuer lawyer", "lawyer") Dahua Certified Public Accountants (special general partnership) (hereinafter referred to as "reporting accountant" and "accountant") and other relevant parties have checked the questions listed in the inquiry letter item by item, and now the reply is as follows. Please review.
explain:
1、 Unless otherwise specified, the abbreviations or terms in the reply report of this inquiry letter (hereinafter referred to as "inquiry reply") have the same meanings as those in the prospectus (declaration draft).
2、 The font in this inquiry reply represents the following meanings:
Bold (not bold): questions listed in the inquiry letter
Arial (not bold): reply to the questions listed in the feedback
Italics (BOLD): amendments to the prospectus (declaration draft)
catalogue
1. Product and technical issues
Question 2. About the sealed test business 26
Question 3. About distribution 35
Question 4. On the verification of fund flow 46. Question 5. On others 49
5.1 material consumption expenditure and prepayment forty-nine
5.2 major contracts and deposits fifty-two
5.3 media questioning Question 1: about products and technology
According to the reply materials: (1) during the reporting period, the proportion of sales revenue of intelligent sensor chips decreased, and the proportion of sales revenue of power management chips and packaging and testing services increased; In 2021, the company's main revenue came from power management chips, while the prospectus disclosure generally focused on smart sensor chips; (2) During the reporting period, the sales unit price of intelligent sensor chip products was generally stable, the sales unit price decreased in 2020, and the sales unit price of power management chips continued to rise; (3) In 2021, the issuer's global market share of magnetic sensor chips was about 1.09%, the global market share of screen bias drive chips and flash drive chips was about 12% - 13%, and the global market share of backlight drive chips was about 1.52%. Many manufacturers in China participated in the market competition, but there were no products with great advantages in market share, and foreign manufacturers still occupied the dominant position in the market; (4) The issuer selected the technical indicators of international competitive products in different fields for comparison, and some competitive products were delivered in 2010 and 2012.
The issuer is requested to explain: (1) the positioning and future development plan of smart sensor chip business and power management chip business, and the reasons why the performance growth of smart sensor chip is slower than that of power management chip during the reporting period; (2) the corresponding voltage, power and technical route of the power management chip products, and compare with the products of the same industry, and further analyze the market competitiveness and advanced technology of the issuer. (3) Further analyze the technical threshold of the issuer's products in combination with the unit price of products in the same industry outside China in the segment market of intelligent sensor chips and power management chips, the division of high, medium and low-end grades in the industry, the proportion of products of different grades in each period of the issuer, the market share and market ranking of the issuer, the competition pattern and main competitors, Whether there is a risk of being replaced by competitors in the future, resulting in a sharp decline in the company's performance, and make risk disclosure and major matters as appropriate; (4) In combination with the earlier delivery time of some competitive products, explain the technical iteration cycle of the issuer's products and competitive products, whether the selected competitive products can represent the mainstream technical level of the industry, and whether the relevant information disclosure of "rapid innovation and technical iteration of integrated circuit products" in the prospectus is objective and accurate. The recommendation institution is requested to verify the above matters and express clear opinions.
reply:
1、 Issuer description
(I) positioning and future development planning of smart sensor chip business and power management chip business. The reason why the performance growth of smart sensor chip is slower than that of power management chip in the reporting period
1. Positioning and future development planning of intelligent sensor chip business and power management chip business
Since its establishment in 2005, the issuer has taken the magnetic sensor chip as the starting point, continuously expanded the product categories and application fields on the basis of core technology accumulation and grasping the needs of end customers, and extended to the optical sensor chip and power management chip
For smart sensor chips, the issuer started early in technology and has rich product category reserves and application scenarios. Based on the characteristics of a wide range of application fields of smart sensor chips, the issuer takes "full category and generalization" as its development strategy and business positioning, constantly improves the product system and expands the application fields, covering downstream markets such as smart home, industrial control, wearable devices, smart phones and computers, security monitoring and so on, So that the company's products can fully meet the market demand, break through the long-term monopoly of international manufacturers in the smart sensor chip market, and gradually stabilize the market position; For power management chips, the issuer focuses on screen bias driver chips, flash backlight driver chips and other sub circuits according to the accurate grasp of the needs of end customers, takes "differentiation and focus" as the development strategy and business positioning, and establishes unique brand and product advantages in the market.
At the same time, the two categories of products of issuers can complement and promote each other. On the one hand, from the perspective of the company's operation, there are certain differences in the downstream application fields and customer structure of the two categories of products. The diversified product structure and customer distribution effectively enhance the issuer's anti risk ability; On the other hand, for some large-scale direct sales customers, such as Huaqin technology and Longqi holdings, the issuer sells intelligent sensor chips and power management chips to them at the same time, which is conducive to fully tap and meet the rich product needs of large-scale customers.
Therefore, the two categories of products of the issuer complement and promote each other, which improves the core competitiveness of the issuer.
For the future development plan, the issuer will be based on independent R & D and innovation, committed to taking technology as the driving force, promoting the breakthrough of domestic chips in technology and market, taking intelligent sensor chips and power management chips as the dual engine to drive the continuous growth of business, and creating an independent and controllable product system. For smart sensor chips, the company plans to focus on further expansion in the fields of automotive electronics, medical monitoring, Internet of things and smart grid in the future. At present, its products have obtained vehicle regulation certification and are supplied to world-famous automobile seat suppliers, so as to enter the supply chain of first-line automobile manufacturers; For power management chips, the company will continue to upgrade the product performance and further improve the market share of products. At the same time, it will closely follow the customer demand, tap differentiated market opportunities, continuously carry out R & D reserves, and form new business breakthrough points. For example, the sales revenue of the company's power driven chips during the reporting period increased from 391500 yuan to 230968 million yuan, with a compound growth rate of 668.07%, becoming a new profit growth point of the company.
2. Reasons why the performance growth of intelligent sensor chips was slower than that of power management chips during the reporting period
During the reporting period, the operating income of the issuer's intelligent sensor chip was 951209 million yuan, 1208329 million yuan and 1972367 million yuan respectively, with a compound growth rate of 44%; The operating revenue of power management chip is 792752 million yuan, 1421359 million yuan and 2805886 million yuan respectively, and the compound growth rate of operating revenue is 88%. The growth rate of operating revenue of the issuer's intelligent sensor chip is lower than that of power management chip, which is mainly due to the different downstream application fields and customer structure. The specific analysis and description are as follows:
(1) The downstream application fields and end customers of the issuer's intelligent sensor chip products are relatively scattered, and the business expansion takes a certain time to accumulate, but the business growth rate of the issuer has exceeded the industry level and companies in the same industry
During the reporting period, the issuer's smart sensor chips were mainly subdivided into magnetic sensor chips. The product applications covered many downstream fields, such as smart home, smart phones and computers, industrial control, wearable devices, transportation and safety monitoring. The top five customers of smart sensor chips accounted for 52.07%, 54.35% and 48.24% respectively during the reporting period, and they were mainly dealer customers, while end customers were more dispersed; In the case of scattered downstream fields and customers, the rapid growth of business needs to expand to new customers and new application fields in addition to the drive of stock customers and stock fields. At present, the localization rate of intelligent sensor chips is low, and the automotive electronics application field, which accounts for a large proportion, is basically monopolized by international manufacturers. Therefore, the growth of the issuer's intelligent sensor chip business needs some time to accumulate. According to the statistics of CCID Consulting, the compound growth rate of China's smart sensor chip market scale from 2016 to 2020 is about 15%. According to the 2021 annual report data of melexis, a company in the same industry of smart sensor chip, its compound growth rate of operating revenue from 2019 to 2021 is 14.99%, and the compound growth rate of operating revenue during the reporting period of smart sensor chip is 44%, which is far higher than the overall market and companies in the same industry, Maintained a good development trend.
Due to the large market scale, rich product segmentation types and a large number of Chinese manufacturers participating in the competition, some Chinese manufacturers have achieved a certain market position through product segmentation breakthrough, and the localization rate is relatively high. During the reporting period, the application fields of the issuer's power management chip were mainly concentrated in smart phones, computers, smart homes, etc. the top five customers accounted for 72.25%, 74.45% and 74.19% respectively, and they were mainly direct customers. Compared with smart sensor chips, the application fields and customer concentration were relatively high. Therefore, the issuer seized the opportunity of rapid market development and realized the rapid improvement of business scale, During the reporting period, the compound growth rate of operating revenue reached 88%.
(2) The verification cycle of the issuer's smart sensor chip's main downstream application fields is long. The downstream application fields of power management chip are mainly consumer electronics markets such as smart phones, and the renewal and project verification cycle is relatively short
Intelligent sensor chips have a wide range of downstream applications. Different application fields have different requirements for the stability and reliability of product performance, and the product verification cycle is different. Take the air conditioning market in the field of smart home as an example. Due to the long life cycle of air conditioning products, in order to ensure the stability and reliability of products, end customers will verify the introduction of new products from the complete cycle of product production, delivery and use. The introduction cycle of new products needs about one year to ensure the reliability of products; Taking the automotive electronics field as an example, the vehicle specification chip has high requirements for the reliability, consistency, safety and stability of the product, and the technical threshold is high. The introduction of a new product needs to go through multiple rounds of certification and audit. Therefore, the development cycle of smart sensor chips for new customers and new markets is relatively long, but once smart sensor chips are introduced into new markets or new customers, they will form a relatively stable demand.
The downstream application fields of the issuer's power management chip are mainly consumer electronics markets such as smart phones, which benefit from the rapid development of economic level, the continuous improvement of residents' consumption level and the rapid upgrading of consumer electronics products. In order to match the iteration cycle of terminal products, the introduction cycle of chip is relatively short. Therefore, the company's power management chip business met the needs of customers during the reporting period, With the rapid growth of downstream terminal market, the growth rate is relatively higher than that of intelligent sensor chip. To sum up, there is a certain difference in the growth rate of operating revenue between the issuer's intelligent sensor chip and power management chip during the reporting period, which is mainly caused by differences in downstream application fields and customer structure, which is in line with the actual situation of the industry and the company. (II) the corresponding voltage, power and technical route of the power management chip products, and compare with the products of the same industry, and further analyze the market competitiveness and advanced technology of the issuer.
1. Comparison of main indexes of power management chip
The issuer's power management chips are mainly screen bias driver chips and flash backlight driver chips. The proportion of revenue in the revenue of power management chips during the reporting period was 81.88%, 87.85% and 84.91% respectively. Due to the different application scenarios of different products, there are differences in the applicable terminal equipment, and there are certain differences in the working voltage and power data of the products. Considering the representativeness, competitiveness and other factors of the main products, the issuer selects the competitive products of international mainstream manufacturers and comparable products of the issuer in the same application field for comparison.
(1) Ocp2131 series products
Specific indicators: comparison of issuer Ti silicon Mitus
（OCP2131） (TPS65132) （SM5109）
The static current is 900ua 800ua 900ua, which is equivalent to that of competitive products
Input voltage range 2.7V ~ 5.5V 2.5V ~ 5.5V 2.7V ~ 5
